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Know Your Options

With the release of the new HARP 2.0 refinance program, the one that allows underwater homeowners to refinance, many banks are struggling to approve and close loans in a timely manner. Some of the larger banks are so backed up and slow in approving loans that they are requiring a 60 day minimum lock for anyone who wants to lock in their interest rate.  They are not allowing shorter lock periods because they simply can’t meet the deadline for a closing in a shorter time frame. A bank can argue that a refinance loan shouldn’t need an expedited turn time like a purchase loan requires since there is no contract deadline to meet. This may be true but the problem is that with turn time so slow for refinances it is spilling over and affecting their underwriting turn times for purchase loans as well.  Most purchase contracts typically require a closing date within 30 days from the time of acceptance.  If a bank cannot provide financing within this time frame then this not only affects the buyer and seller of that particular home but can start a chain reaction of delays on the homes that the sellers are moving into and we will start to see a domino effect. This is not healthy for a housing recovery especially in our State where foreclosures have stalled the recovery process enough with the average foreclosure taking 2 years to complete. The delay may also force people in taking a higher interest rate or incurring higher fees because typically the longer period you lock in for the higher the rate and/or fees on the loan.

This is why I believe it’s crucial in having options when it comes to choosing your mortgage professional or lender. A mortgage broker has the advantage of working with numerous wholesale lenders and banks. This affords them the opportunity to shop a borrower’s loan not only for the best interest rate and program but also the quickest turn time as well. A wholesale broker has a competitive advantage over the banks for the mere fact of having options. For those of you who are interested in refinancing and want to know if your loan is owned by either Fannie Mae or Freddie Mac, please visit the following websites and enter in your home address: http://www.fanniemae.com/loanlookup/ or https://ww3.freddiemac.com/corporate/  If your loan is owned by either Fannie or Freddie and you would like to take advantage of the HARP 2.0 program, we encourage you to call us today.  If you are looking to purchase a home and need to close within 30 days, no problem, just give us a call.  To learn more about our company and mortgage products, please feel free to call Dan Longman, President of Priority Lending Corp, at 954-438-3776 ext.11 or email me at prioritydan@bellsouth.net.

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